The Nation That Fell To Earth

Did the U.S. overreact to Sept. 11? Niall Ferguson, one of the world's leading historians, speculates on how future generations will judge the war on terrorism--and on what it will take for America to win it

Yet the terrorists also had their bloody successes, in Madrid in March 2004 and London in July 2005. What was particularly disturbing was the social background of those responsible for the atrocities--the successful and the foiled alike. Some of those responsible for bombing the London Underground, for example, were British born. Shehzad Tanweer grew up in Leeds and was a keen cricketer. His father owned a fish-and-chips shop. And it was not only the sons of prosperous immigrants who were being attracted to terrorism. Two of those arrested for their suspected role in the Heathrow bomb plot were Muslim converts. One of them was the son of a deceased Conservative Party employee with an impeccably British double-barreled surname, Stewart-Whyte.

The U.S. did not have an effective strategy for dealing with the penetration of Western Europe by radical Islamism. On the contrary, differences over policy in the Middle East had succeeded in driving a wedge between the U.S. and the most important continental European countries, Germany and France. British Prime Minister Tony Blair was unwavering in his support of U.S. strategy, but the British public came to regard Blair as an American poodle, and his Conservative successor David Cameron was far cooler toward Washington.

It was one of the great ironies of the war on terrorism that just five years after 9/11, many counterterrorism experts were convinced that the most likely source of another big attack on the U.S. was not the axis of evil but conceivably America's closest ally, Britain.

IV THE GREAT ASIAN DEPRESSION

Had another terrorist attack--or an Iran-Israel war--happened sooner, it might have made the difference in the 2008 presidential election. After all, a large part of John McCain's appeal as a presidential candidate was his--and his family's--distinguished record of military service. Many Republicans bitterly regretted that McCain had not been their candidate eight years before. "He might have been the greatest war leader we never had," his campaign manager said on Nov. 3, 2008, after McCain conceded defeat to Mark Warner, the former Governor of Virginia.

The Democratic candidate owed his victory, above all, to the return of the economy to the top of the political agenda. To most Americans, the key issue in 2008 was--as it had been when another Southern Democrat won the presidency 16 years previously--"the economy, stupid." Some experts argued that the economy had never stopped mattering. Bush won in 2000 because the dotcom bubble burst that year. He won in 2004 because his tax cuts and the easy-money policies of Federal Reserve Chairman Alan Greenspan had generated a sustained economic recovery. Unfortunately for the Republicans, that recovery could not last forever.

The economic slowdown of late 2006 was part of a wider crisis of globalization, as energy prices soared and the drive toward free trade lost momentum. With oil stuck above $70 per bbl. and the Doha round of trade negotiations defunct, growth was bound to slacken. But what made matters unexpectedly worse was miscalculations by the world's central bankers.